Default would be ‘horrendous’: WFC ex-CEO

Defaulting on its debt would be much more serious for the United States than any fiscal cliff or government shutdown, former Wells Fargo Chairman and CEO Dick Kovacevich said Monday.

"Obviously we have the resources to pay our bill, but we don't have the political will to do so, and that's just a tragedy," he said. "We just can't have a default. It would horrendous if we did."

On CNBC's "Fast Money," the Wells Fargo chairman emeritus said that the world's confidence would be shaken in the United States as the reserve currency if Congress failed to authorize payment on U.S. debt.

Kovacevich said that an increase in interest rates would slow rising housing prices and lead fewer homeowners to refinance their mortgages.

"You're going to see housing prices either stop or stay steady," he said. "They may even fall in the future, and you're already seeing some incentives ... by new-home builders. If we can keep our economy reasonably strong, the purchase side of the mortgage side will still be good. We just won't have the refinances that we got in the past."